Chinese millions tracked to French vineyards

Millions of pounds of government money used to snap up 14 French vineyards

China is the world’s fifth largest wine consumer, as well as the biggest market for red winePhoto: ALAMY

By Tom Phillips in Shanghai and Henry Samuel in Paris

8:28PM BST 25 Jun 2014

Chinese government funds have been squandered on French vineyards and secret trips to Las Vegas, Communist Party auditors revealed on Wednesday.

In the latest attempt by Beijing’s spin doctors to promote President Xi Jinping’s high profile “war” on corruption, the National Audit Office announced that its investigators had solved more than 314 major cases last year.

The most startling revelation was that millions of pounds of government money had been used to snap up 14 French vineyards.

The National Audit Office singled out two companies which it said had received public money from local authorities and used it to buy vineyards in France’s Bordeaux region.

Around 268 million yuan (roughly £25 million) was allegedly spent by the two firms from Dalian, a northeastern port city that was once the power base of Bo Xilai, the disgraced Communist leader whose career collapsed after his wife was convicted of the 2011 murder of British businessman Neil Heywood.

One of those companies was the Haichang Group, a firm that made its money in oil and now operates a variety of businesses including marine theme parks and golf clubs, and has blazed a trail for China’s growing investment in French vineyards.

The company, which also sponsors the Dalian International Wine & Dine Festival, had acquired up to 10 properties in Bordeaux by 2013 with plans for 15 more, according to wine industry magazines, though three of them were reported to have been put up for sale last year.

China is now the world’s fifth largest wine consumer and the biggest market for red wine, having drunk 1.865 billion bottles last year.

It is also the top export market for Bordeaux, and Chinese companies have been piling into the region in recent years. Around 60 chateaux are currently though to be under Chinese ownership - a drop in the ocean compared to the 7,000 wine-growing domains in the region but a reality that has upset some locals.

More recently, the Chinese have set their sights on Burgundy. In 2012, Louis Ng Chi Sing, a Chinese gambling tycoon, outbid local vintners to pay €8 million for Chateau de Gevrey-Chambertin, sparking dire warnings from local growers of a “foreign invasion” of mainly Asian investors.

The sale led one disappointed local bidder to exclaim: “What would the Chinese say if French investors bought up 10 or 50 metres of the Great Wall of China?”

Xi Jinping, head of the Communist Party since November 2012, is also unlikely to be impressed that government money was used to bankroll China’s advance into Bordeaux. He has made fighting corruption and extravagance one of the key policies of his administration.

Critics accuse the president of using his anti-corruption campaign as cover for a politically motivated purge of his rivals, but allies insist it is helping clean up the Party.

“Our goal is clear,” Wang Qishan, China’s anti-corruption tsar told state media this week. “We are disciplining the ruling party itself, tightening up its internal management, and boosting the drive for good governance to resolutely contain corruption.”

Suspicious vineyard deals are not all Chinese auditors claim to have uncovered.

Employees of the China Geological Survey are said to have absconded while conducting an official fact-finding mission on shale gas in North America.

The group claimed it was Canada but had in fact embarked on a three-day reconnaissance mission of Las Vegas. It was not clear which, if any, casinos the geologists inspected during their 72-hours in Sin City.

Liu Jiayi, China’s auditor general, told state media the scandals uncovered by his teams indicated that “problems of orders being disobeyed and prohibitions being defied persisted”.

Scandal-weary Chinese internet users reacted with sarcasm to the news that government funds had ended up in Bordeaux.